Strict New Controls on Foreigners

[Lord Toad]

No remember after the Tsunami volanteer workers were told they must have a work permit!!!

 

On the issue of foreign companies and tax I have a friend who is CFO of a big Foreign com. His description of what happens every year is something along these lines;

He sends in tax return and a few weeks later a tax inspector turns up.

 

TM: You must pay more tax

CFO: Why

TM: Well you must

CFO: But have I not calculated everything correctly? What is wrong?

TM: That is not the point you have to pay more tax

CFO: Unless you can tell me why? How can I agree? I must explain to my board why I have to pay more tax than I said.

TM: If you do not agree to pay more we must conduct a full tax audit (that involves a load of hassle)

CFO: But why you did that last year and you found nothing major wrong: and the year before.

TM: Shrug

CFO: But look at my percentages both our gross and not are way ahead of most Thai listed companies. Why not do a full audit on them?

TM: You have to pay more tax!

[samak]

yep i know from my own experience this sort of crazy conversation with uncapable, bureaucratic, stubborn.... authorities.

nothing new again; that already was the case over 10 years ago when i started my first job in BKK.

but what did your friend do? did he actually pay more?

[BuffHello]

Unfriendly to foreign investors

 

Editor;

Yesterday my attorney went into the Pattaya Land Office to register a land transfer for a parcel of land in Pattaya from a private Thai name (seller) into a Thai company name (buyer). I (a farang) was listed as a 49% shareholder and five Thais were listed as the 51% shareholders in the company. For many previous transactions over many years, this has always satisfied the government regulations and the name change on the land title deed papers was always approved. Now - so sorry - new government directive from Bangkok. 1) all shareholders must be present at the land office and their identities verified for this type of transfer to occur, 2) if there are any foreign shareholders, the change will not be approved. Over forty transactions were rejected the first day of this new directive. Effectively this prevents any foreigner from investing in new property transactions; land or houses in Thai company names and condo projects exceeding the 49% foreign ownership rule. Way to go Thailand - a great way to make this country investor friendly!

Signed,

Looking Elsewhere

 

pattayamail letters

[buddha]

While I love visiting and even living and working in Thailand, I have never had the urge to buy any property or start a business there.

 

When the gov't makes announcements like this it actually makes thailand look like a better deal in my eyes.

 

Work permit - Visa Runs - No Plobrem!

 

That doesn't affect me. I realize how it would affect someone with a family, or a lot of possesions to move around.

 

Visa runs have always been a chance for me to see something, even if for one day. I love the market at aranyaprathet.

 

Land Ownership - who wants to buy when renting is soooo cheap? I have found apartments in BKK that cost no more than 4000 - 8000 baht and they are more than livable.

[kojis]

Serious issue here, and lots of problems in my trade over the last year, heard in prolly all few countries I've visited during that period abt people afraid to come to Thailand because of unpredicatle policy enforcement.. .been wondering for a while what's the need to tick the "business' purpose of visit on the arrival form, clearly states that one is comng here to conduct business so what's the situation after they let u in after u ticked it (which i do). Note as well that this part of the form is the one taken by the immigration upon arival, u won't be able to show it in case of control inside the country.

[Flashermac]

I was auditted twice in three years during the mid 1980s, at a time when university lecturers made around 15,000 baht a month. The first time they found an error of a few hundred baht, for which I had to pay with a fine of several thousand! I complained that the TAX OFFICE themselves had done my income tax return for me. They said, so what ... it was my tax form. The second time I'd done it myself and there was nothing wrong.

 

A friend who worked for the Bangkok Post and made several times my salary asked me, "Why would they audit you? Your government pay is so low they couldn't get anything from you any way."

 

Maybe I was a softer target than a big international firm?

 

[Flashermac]

re: Malaysia ...

 

You do not even have to leave the country to renew your 90 day visa, which is free. And easy solution would be to live in Georgetown, Penang -- and fly up to Bangkok periodically. Only costs around 4,000 round trip on Air Asia.

 

The Thais are so worried about "foreigners" taking over their country. I've got news for them. The Chinese already did about 50 or 60 years ago!

[Guest]

There is a lot of stuff here, but let me start with the work permit issue. I suspect most foreigners are surprised about this aspect of Thai work permit law. Someone asked where I came up with:

Work Permit Laws will be Strictly Enforced: Under Thai law, you need a work permit even if you fly in for a single business meeting or to inspect a project. "Business Visas" do not count qualify. Even attending a business conference or convention constitutes work.

Let me provide some outside sources you can verify. I don?t pretend to know all of the answers and some of my sources are based on, for example, what my work permit lawyer told me. But you need to measure that against a few items that are readily available and easy to verify by, say, popping into Asia Books and picking up a few books that are for sale on this subject (I cannot provide web links to the contents of those books - you'll need to shell out 500 or so Baht).

 

Baker & McKenzie, a well known international law firm, has a book called ?Doing Business in Thailand?. If you haven't heard of this firm, here is their main site Baker & McKenzie's Main Site site for Thailand and site for the Thailand Office I am pretty sure you can pick this up at Asia books. The first sentence of this book?s section on Work Permits (Section 11.5 at page 68) says:

The Working of Aliens Act, B.E. 2521 (1978) requires all foreigners to obtain a work permit prior to working in Thailand. The definition of work is extremely broad and means ?engaging in any work by exerting energy or using knowledge whether or not in consideration of wages and other benefits.?

Another international law firm, Deacons, has a book called ?Doing Business in Asia?. I am not sure if this is available in the stores because they sent me a copy for free (probably trying to get business), but the firm is mentioned in the AMCHAM guide as having been here for 40 years and according to their website Law Firm they have 900 lawyers in Asia-Australia. In the work permit section of the Thailand chapter of their book you will find this:

Any foreigner working in Thailand must have a work permit, and the definition of work is extremely broad. Work is defined as ?engaging in work by exerting energy or using knowledge whether or not in consideration of wages or other benefits.? Many foreigners find this broad definition of work counterintuitive because it can encompass such short-term activities as participating in a single business meeting. Arrests of foreigners for work permit violations are not uncommon, particularly in contentious situations.

Two well known international law firms saying virtually the same thing. They both say an immigration visa (including a business visa) and a work permit are different things, a visa does not allow a foreigner to work, and work is extremely broad (and I would read it as incluiding attendance at a single meeting or a convention - the definitions both firms use are identical, so that must be what the law says). I had to go to a bit of trouble to collect all of this, so if somewhat has sources that say something different, I?d like to see it because I'd love to be persuaded that these laws don't exist.

 

Now back to reality - the laws clearly do exist. In other words, based on these cites, I don't see how anyone can persuasively argue that the MIB couldn't claim that attending a business meeting, a convention, or working out of the business center of a hotel without a work permit does not violate Thai work permit laws. Look at the definitions described above.

 

It is contrary to what most people would expect; Deacons euphemistically calls it ?counterintuitive?, so I can undestand why there is some skepticism about this, but I cannot find anything reliable that says anything different. Again, if anyone here has a reliable source that says something different, please post it.

 

Now you can say the authorities would never enforce these laws, but that is contrary to what these sources say and my own experience. We all know how Thailand works. And the MiB must obviously know about this law, which also means they know they are on solid ground if they arrest a foreigner for doing any of these things. And we all know here that the MiB are quite capable of engaging in selective and opportunistic enforcement laws for financial gain. In most cases, foreigners don't even know they are violating the law. This is just another example of that.

 

Samak is right about the Effective Planners case being high profile. But the Deacons guide says arrests for work permit violations are ?not uncommon?, the Baker & McKenzie guide gives a definiton of work requiring a permit that would certainly include attendance at a business meeting or a convention, and I (for what you may think that is worth) know a few foreigners that were arrested for work permit violations. And if the people arrested in the Effective Planners case had work permits (which are mostly written in Thai), but still violated the law on some minor points (like working just across the city line), imagine what happens if a foreigner has no work permit whatsoever. In other words, I think the Effective Planners case is an example of how this law can and is applied in ways that are ridiculous and make Thailand look ridiculous.

 

The political situation now in Thailand is contentious, and there are many who have an interest in creating more problems (more about that below). And unless my work permit lawyer was just bullshitting me (which I doubt), enforcement of work permits laws is becoming more serious. Isn?t that consistent with everything else we see going on here?

 

Samak is also right about mixing up the case involving Mike Wansley of Deloitte and the Effective Planners case. But also recall that immediately after the murder of Mike Wansley, even though the spot light was on Thailand, the immigration police raided Deloitte looking for foreigners without work permits. This is another example of enforcing the work permit laws in a manner that is bad for Thailand as a whole because it serves the interests of an influential vested local party with a separate agenda. Happens all of the time.

 

Don?t think the authorities aren?t capable of engaging in acts that are bad for Thailand as a whole if it is in their individual interest (for example, they have been paid) to do so. Anyone who has lived has probably experienced this at one level. I will quote Samak from this very thread for that point: ?yep i know from my own experience this sort of crazy conversation with uncapable, bureaucratic, stubborn.... authorities?

 

In this context, and with the laws to legitimize such action, I am giving what my work permit lawyer told me more than a little credence.

 

In this very thread, we?re seeing posts from other sources about problems. BuffHello quotes material about problem with a property registration:

Yesterday my attorney went into the Pattaya Land Office to register a land transfer for a parcel of land in Pattaya from a private Thai name (seller) into a Thai company name (buyer). I (a farang) was listed as a 49% shareholder and five Thais were listed as the 51% shareholders in the company. For many previous transactions over many years, this has always satisfied the government regulations and the name change on the land title deed papers was always approved. Now - so sorry - new government directive from Bangkok. 1) all shareholders must be present at the land office and their identities verified for this type of transfer to occur, 2) if there are any foreign shareholders, the change will not be approved. Over forty transactions were rejected the first day of this new directive.

This sort of stuff is not exactly reassuring in a place like Thailand. We all should remember that before 1997 financial crisis, the property market went through a boom, and then crashed. Remember all of the half-complete building you used to see around Bangkok?

 

Now considers our current situation:

 

1. We are in another property boom, but it is starting to get a bit shaky.

 

2. The economy is certainly getting shaky.

 

3. There are parties that have an obvious interest in seeing economy get a bit more shaky.

 

4. Tourism and foreign investment are critical to the Thai economy, and strictly enforcing work permit laws, land ownership laws and the Alien Business Law will seriously the Thai economy.

 

5. It will do so in a way that doesn?t affect those with an interest in seeing economy get a bit more shaky. (hint hint)

 

6. Thailand has laws that allow such interference. In other words, they can claim they are "just enforcing the law." (Farangs buy into this argument; Indeed, I see that argument here by other posters when I complain about an idiotic local law. Those in charge know that Farangs buy into this - what I consider to be a - nonsensical argument).

 

7. We have seen examples of selective enforcement of laws here when it suits a powerful person?s interest.

 

8. In the last month there have been new regulations issued to implement such laws ? see the article in the 31 May 2006 edition of the Bangkok Post (?the property boom ended on May 25? ? the date the article says one of the new regulations was issued (the article got the date wrong, and there is another regulation as well))

 

9. They are implementing such laws now ? see the quote above.

 

All of this is happening now. You have to wonder why?

[chuckwoww]

Flashermac said:

 

The Thais are so worried about "foreigners" taking over their country. I've got news for them. The Chinese already did about 50 or 60 years ago!

 

They are the ones that worry.

[OCgringo]

Thanks Gadfly for the update ,

 

We know that they have asked for work permits near the BTS ,

I just find it hard to believe they are stupid enough to "raid" a convention at BITEC , find out 90% did not have a work permit and throw them all in jail and deport them ,

 

The MIB who did this would be sent to Thai Siberia (wherever that is)

 

I will do my same "work" , visit the same factories , and if I get arrested I will be sure to write a report

 

OC

 

will be there in 18 days,,,,,